The due process clause of the 14th Amendment prohibits a state from imposing a "grossly excessive' punishment, wrote Justice John Paul Stevens for the majority.

By a 5-4 vote, the justices said the judgment violated BMW's due process rights.

Gore sued BMW of North America and won $4,000 in actual damages and $4 million in punitive damages - or $4,000 for each of the estimated 1,000 1990 model BMWs sold nationwide in the same condition. The Alabama Supreme Court cut the original $4 million verdict in half.

Gore's car, a 535i model, had been partly repainted to touch some damage sustained during shipping. Gore learned about the touch-up nine months after buying it.

The high court said the economic penalties a state imposes must be supported by the state's interest in protecting its own consumers and economy, rather than those of other states or the entire nation.

Gore's award must therefore be analyzed in the light of conduct that occurred solely within Alabama, with consideration being given only to the interests of Alabama consumers, the court said.

The court ruled that the harm BMW inflicted on Gore was purely economic and that the repainting had no effect on the car's performance, safety features or appearance.

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